Pratt Says 1,480 To Retire Under Buyout Offer

1,480 Salaried Workers Accept Buyout, Pratt Says

December 20, 1991|By ROBERT WEISMAN; Courant Staff Writer

Jet-engine maker Pratt & Whitney said Thursday that 1,480 of its salaried employees in the United States -- including 1,069 in Connecticut -- have elected to retire under a Pratt buyout offer extended last month.

At two of Pratt's affiliates, USBI of Huntsville, Ala., and Chemical Systems of San Jose, Calif., another 278 white-collar workers accepted the company's voluntary severance and retirement incentive program.

And, separately, the United Technologies Research Center on the grounds of Pratt's main compound in East Hartford said 144 employees are taking early retirement, while Norden Systems of Norwalk said 116 workers accepted its buyout plan.

Pratt and its affiliates, the research center and Norden are all part of Hartford-based United Technologies Corp., an aerospace and industrial giant struggling to cut $1 billion from its annual operating costs to become more competitive.

Those and other UTC units offered their salaried employees early-retirement incentives after UTC extended a buyout offer to its corporate staff in October. Three hundred of the 1,000 corporate employees in Hartford, Washington, D.C., and elsewhere accepted that buyout.

"Every company in the United States -- IBM, General Motors, Grumman, Boeing -- is doing the same thing," said David J. Franus, analyst with Forecast International in Newtown. "You lose people who have an immense amount of experience and knowledge of the industry and keep the younger and more energetic people, and I'm not sure that's necessarily a good thing."

At the same time, Franus said, "This will help get them where they want to go in terms of cost savings."

Pratt and the other UTC units could offer no figures Thursday on the savings they expect to realize from the buyouts, each of which was structured differently. Nor could they say how much the buyouts will cost them in severance, higher pension payouts and other expenses.

UTC last month announced that it would post a loss for 1991, its first annual loss in 20 years, citing expenses associated with

its buyout programs and other cost-cutting moves. The company said the size of the loss had yet to be determined.

Pratt spokesman Mark Sullivan said about a third of the 5,240 eligible employees at Pratt and its affiliates took the buyout. While there was no specific goal, the number of workers leaving was about what the company had expected, he said.

At Norden, meanwhile, about 61 percent of those eligible accepted the buyout -- with 91 leaving Norden plants in Norwalk and Trumbull and 25 leaving a site on Long Island. That, too, was about the number the company expected, said Norden spokesman Scott Brinckerhoff.

"I think it was regarded as a more than fair package," he said. "And I think people understand the company's [financial] circumstances."

Karen Breckbill, spokeswoman for the research center, said the 144 employees leaving there were fewer than the 170 expected. Eligible workers at UTC's Hamilton Standard division in Windsor Locks, meanwhile, have until Jan. 3 to decide on a buyout offer. Unlike the UTC buyout, which was offered to all corporate staff members, the retirement incentives at Pratt and most other units were limited to workers 55 or older with at least five years tenure, or those at least 50 with at least 15 years tenure.

In addition to the 1,069 workers departing from Pratt's operations in Connecticut, another 338 will be leaving its West Palm Beach, Fla., plant, while 55 will be retiring from a plant in North Berwick, Maine, 12 from a plant in Columbus, Ga., and six from a plant in Clayville, N.Y.

There was no breakdown within Connecticut, where Pratt has sites in East Hartford, Middletown, Southington, North Haven, Rocky Hill and elsewhere. The workers at Chemical Systems and USBI will be retiring from operations in Huntsville, San Jose and Cape Kennedy, Fla., Sullivan said. Almost all the retirements will take effect by March 31.

Referring to financial problems dogging Pratt and its sister UTC operations, especially federal budget cuts and the airline industry recession, Sullivan commented, "Some of this is cyclical, some is permanent, and we have to become a different company because of it.

"This [buyout] recognizes our need to downsize, and it recognizes the contributions of the veteran employees who have made this company what it is," Sullivan said. "This will give them some security."

Sullivan would not say whether any senior executives or vice presidents took early retirement at Pratt, where the deadline for accepting the buyout offer was Wednesday night.

In a related matter, Sullivan said Pratt executives are in the final phase of a manufacturing capacity study aimed at consolidating the company's network of plants and equipment in Connecticut and reducing its area supplier base.

He said Pratt is expected to unveil a five- or six-year consolidation plan around mid-January.

Sullivan also said blue-collar workers at Pratt will be eligible for early retirement under a separate program in the first quarter of 1992. "There is a window for the hourly people based on the terms of the new labor contract," he said.